TEHUANTEPEC 

INTER-OCEAN  RAILROAD, 


MEXICO. 


SYDNEY 


3*?  5 


UN'VERSSTY  of  ILLINOIS  I1 


Tehuantepec  Inter-Ocean^  Railroad, 


Locality. 

Mexico,  one  hundred  miles  southegst^rl^  hvm 

* / / j ' 

Vera  Cruz,  connecting  the  Gulf  of  Mexico  with  the 
Pacific  Ocean  across  the  Isthmus  of  Tehuantepec. 

Route. 

From  the  harbor  of  Coatzacoalcos  on  the  Gulf  to 
the  Port  of  Safina  Cruz  on  the  Pacific,  one  hundred 
and  sixty-five  miles. 

Topography. 

The  Isthmus  presents  an  exceptionally  favorable 
surface  for  the  construction  of  the  road.  The  At- 
lantic plains,  intervening  between  the  Gulf  and  the 
base  of  the  mountain  range,  and  covering  nearly 
one-half  the  entire  fine,  are  similar  to  “ bottom 
lands,”  with  transverse  ridges  which  form  an  undu- 
lating surface.  The  middle  section  embraces  the 
northerly  slopes  of  the  mountain  range,  the  plains 
of  Tarifa and  Chivela,  the  several  “ passes”  through 
the  crest  of  the  mountains,  and  the  short,  steep  in- 
cline from  the  passes  to  the  Pacific  plains,  which 
have  a gradual  inclination  to  the  Pacific  of  about  ten 
feet  to  the  mile.  The  middle  and  Pacific  sections 
are  mostly  through  open  country,  free  from  engi- 


2 


neering  difficulties,  excepting  such  as  will  be  en- 
countered in  descending  from  the  summit  “pass” 
selected,  to  the  Pacific  plains. 

Location. 

The  surveys  and  explorations  made  by  the  Com- 
pany, and  which  supplement  those  made  in  1851, 
1859  and  1871,  by  Gen.  Barnard,  TJ.  S.  A.,  Gen.  Si- 
dell,  TJ.  S.  A.,  and  Com.  Shufeldt,  U.  S.  N.,  re- 
spectively, show  that  upon  final  location  a maxi- 
mum grade  of  about  one  per  cent.,  or  52.8  feet  per 
mile,  can  be  obtained,  unless  the  direct  short  line 
of  Gen.  Sidell,  from  Chivela  Pass  down  the  moun- 
tain slope,  with  a continuous  grade  for  nearly  four 
miles  of  about  two  per  cent.,  shall  be  found  more 
advantageous  than  the  longer  and  more  tortuous 
lines  from  either  of  the  other  practicable  “ passes.” 


Climate,  Soil  and  Productions. 

The  climate,  soil  and  productions  are  different  on 
the  three  divisions.  On  the  Atlantic  plains,  fifteen 
miles  from  the  coast,  the  temperature  ranges  from 
60°  in  the  winter  to  90°  in  the  summer. 

In  the  Cordilleras  division  the  temperature  ranges 
from  60°  to  85°,  and  in  healthfulness,  purity  of  at- 
mosphere and  general  attractiveness,  this  division 
will  compare  favorably  with  any  section  on  the  con- 
tinent. 

The  Pacific  division  has  a dry  atmosphere,  except 
during  the  autumnal  rains — temperature  from  60° 
to  90°. 

The  soil  on  the  Atlantic  division  is  exceedingly 


3 


rich,  producing  tobacco,  coffee,  sugar,  cotton  and 
Indian  corn,  and  all  tropical  fruits  ; valuable  woods, 
mahogany,  cedar,  pine,  live  and  white  oak,  &c., 
abound,  and  asphaltum  and  petroleum  are  found. 

The  soil  of  the  Cordilleras  division  yields  similar 
products  and  excellent  pasturage  in  its  immense 
plains  and  valleys,  and  the  neighboring  mountains 
are  known  to  be  rich  in  the  precious  metals. 

The  soil  of  the  Pacific  division  is  very  productive, 
even  with  the  imperfect  irrigation  of  the  Indians. 
When  for  this  purpose  the  abundant  mountain 
streams  shall  be  used  by  future  settlers,  the  produc- 
tion will  be  immense. 

The  population  of  the  Atlantic  division  is  gathered 
in  Indian  villages  of  from  one  to  six  thousand  souls, 
at  intervals  of  six  to  ten  miles.  These  Indians  cul- 
tivate tobacco,  coffee,  &c.,  for  export.  On  the  Cor- 
dilleras the  population  is  sparse,  but  upon  the  Pa- 
cific division  it  is  very  large,  some  of  the  villages 
containing  from  ten  to  thirty  thousand  persons. 

Relations  to  Commerce. 

This  Isthmus  route  shortens  all  lines  of  communi- 
cation between  the  principal  ports  of  the  Atlantic 
and  Pacific  Oceans,  and  will  attract  to  it  a large  por- 
tion of  the  trade  of  California,  Oregon,  China, 
Japan,  Australia,  New-Zealand,  Manila,  Java,  Ba- 
tavia, and  the  numerous  fertile  islands  of  the  Pa- 
cific, and  will  compete  for  South  American  “ West 
Coast”  trade,  which  now  passes  over  the  Panama 
road. 

The  gross  tonnage,  inward  and  outward,  to  and 


4 


from  these  localities  in  1878,  exceeded  2,500,000 
tons,  wool,  wheat,  sugar  and  tea  being  the  most 
prominent.  Australian  wool  by  this  route  can  be 
delivered  in  England  in  fifty  or  fifty-five  days,  giv- 
ing an  advantage  in  time  of  from  fifty  to  seventy- 
five  days  ; and  California  wheat  can  be  so  delivered 
in  fifty  days,  with  a time  advantage  of  from  seventy 
to  ninety  days,  and  an  avoidance  of  any  damage 
from  twice  crossing  the  equator.  Ordinary  drafts 
against  shipments  by  this  route  may  be  provided 
for  by  sales  and  actual  delivery  before  maturity. 

As  a passenger  route,  the  line  will  offer  the 
inducements  of  favorable  latitude,  salubrious  cli- 
mate, direct  transit  and  shortness  of  sea  voyage, 
with  freedom  from  extremes  of  heat  or  cold,  and 
the  vicissitudes  of  navigation  around  Cape  Horn. 

Merchandise  from  the  East  Indies  and  Northern 
Pacific  ports  can  be  delivered  by  the  Tehuantepec 
route  at  Galveston,  New-Orleans,  St.  Louis,  Chicago, 
and  all  Atlantic  ports,  and  to  localities  tributary  to 
these  points  more  cheaply  than  by  trans- continental 
railways ; an  expectation  of  great  significance,  in  view 
of  the  consolidations  by  which  naturally  competing 
lines  of  railway  are  being  merged  into  a common 
and  monopolizing  ownership,  and  steamship  lines 
are  practically  being  subsidized  to  prevent  com- 
petition in  rates. 

The  saving  of  distance  is  uniformly  and  largely 
in  favor  of  this  route,  as  is  illustrated  by  the 
following  examples  taken  from  the  tables  prepared 
by  the  U.  S.  Coast  and  Geodetic  Survey  Office  at 
Washington  : 


5 


6 


o 

- 

- 

- 

- 

a 

V*  V* 

a 

5 

a> 

*a 

- 

- 

21 

o3 

u 

o 

a o 

03 

a 

a 

c$ 

W 

1 W 

1 

rH 

00 

CO 

0 

00 

xo 

<D 

£3  (D 

a 

CM 

<M 

-tH 

s 

Ph 

CCS 

C3  cl. 

P-i  * 

c3 

PM 

c<r 

oT 

of 

CO*' 

o 

o 

S 

v* 

V* 

v. 

v. 

V, 

v. 

s» 

V,  v. 

i> 

** 

N# 

>• 

**» 

** 

S»  V* 

o 

a 

a 

o 

vl 

5J 

\#  s 

j-i 

a> 

& 

-t^ 

XO 

rH 

05 

ca 

O 

h* 

00 

05 

CO 

Oi  x>* 

CO 

CO 

i- 1 

r— 1 

rH 

r— 1 

rH 

CO 

Tt< 

CN 

CM 

o 

aT 

0) 

ra 

Sj 

V* 

v* 

u 

VJ 

V*  x* 

V* 

a 

** 

** 

** 

** 

'• 

*• 

N# 

CO 

o 

o 

CO 

CM 

o 

xo 

■t— 

■tH 

00 

rH 

r-  o 

o 

CO 

CM 

CM 

lO 

iC 

«-H 

»o 

h* 

CO 

00 

CO 

xo 

CO  (M 

CO 

00 

00 

00 

1—1 

rH 

CO 

"ch 

■t- 

■c- 

00  lO 

I— 1 

r— t 

rH 

r-H 

rH 

I— 1 

o' 

cf 

OO*' 

rH 

rH 

>% 

c3 

t> 

p- 

a 

- 

X 

- 

- 

- 

- 

t vl 

- 

sf 

01 

aT 

o 

O 

^1 

o 

Q 

eT 

o' 

o 

o' 

o 

r—> 

c3 

.a 

a 

a 

02 

to 

a 

m 

to 

o 

02 

to 

o 

02 

o 

o 

13 

ti. 

a 

c3 

*a 

a 

cci 

fS 

of 

S 

c3 
■ (— 1 
O 

a 

o 

W 

to 

O 

fl 

‘a 

a 

c3 

pc< 

cf 

a 

03 

r0 

o 

a 

o 

W 

to 

a 

fl 

’a 

a 

c3 

pS 

cf 

a 

o3 

O 

a 

o 

M 

to 

r*~» 

a 

c 

*o 

a 

c3  - 
£ 

- 

c3 

N 

-*H 

c3 

O 

O 

£ 

'Sh 

02 

<5 

02 

0 

HH 

a 

PL, 

C 

c3 

02 

r^! 

O 

a 

o 

K 

m 

9 

02 

O 

t* 

Hon 

'■O 

02 

a 

c3 

02 

o 

>-< 

a 

o 

W 

nU 

>% 

02 

a 

c3 

02 

o 

HH 

rg 

O 

a 

02 

’O 

O 

HH 

m 

O 

-H> 

o 

H=> 

o 

-t-5 

O 

£ 

a 

c3 

V, 

SO 

c8 

a 

O 

o 

>* 

a 

o 

O 

c3 

a 

o 

a 

c-5 

02 

£ 

a 

O) 

P> 

c3 

> 

o3 

a 

o 

£ 

£ 

3 

w 

«+H 

t 

<D 

g 

o 

o 

a 

o3 

vj 

V. 

v* 

s. 

V 

V. 

s* 

V*  V* 

V, 

a2 

to 

.5 

5 

’> 

c3 

02 

6 


National  Relations. 

In  view  of  the  prevailing  public  attention  to  the 
subject  of  Inter-oceanic  communication,  and  of 
the  transfer  of  the  Panama  Road  to  a foreign 
ownership,  it  is  opportune  to  suggest  that  the 
geographical  position  of  this  road  has  a highly 
important  political,  as  well  as  commercial  relation 
to  American  interests.  The  Gulf  of  Mexico,  with 
its  horse  shoe  outline,  extending  from  the  Tortugas 
of  Florida  to  Yucatan,  and  flanked  by  the  Island  of 
Cuba,  holds  such  relations  to  the  business  and 
security  of  many  of  the  United  States,  and  of  the 
States  of  Mexico,  that  it  should  be  securely  within 
the  exclusive  and  concurrent  control  and  protection 
of  these  Governments. 

It  is  worthy  of  mention  that  in  1847,  before  the 
acquisition  of  California,  our  Government  authorized 
Mr.  Trist,  then  U.  S.  Commissioner  to  Mexico,  to 
offer  an  increase  of  $15,000,000  to  the  negotiations 
then  pending,  provided  the  right  of  passage  and 
transit  across  the  Isthmus  of  Tehuantepec,  secured 
to  the  United  States  by  the  eighth  article  of  the 
Projet , shall  form  part  of  the  treaty ; subsequently, 
viz.,  in  the  Gadsden  treaty,  ratified  in  1854,  an 
article  was  inserted,  securing  certain  rights  to  the 
United  States  in  the  route,  and  authorizing  that 
Government  “to  extend  its  protection,  as  it  shall 
judge  wise,  to  it  when  it  may  feel  sanctioned  and 
warranted  by  the  public  and  international  law.” 


7 


Harbors. 

The  eminent  Government  and  Civil  Engineers 
who  have  personally  surveyed  and  investigated  the 
feasibility  of  the  proposed  harbors  concur  in  the 
opinion,  that  with  a comparatively  moderate  outlay 
they  can  be  made  accessible  to  the  largest  class  of 
ships,  and  will  be  in  all  respects  suitable  and 
adequate  for  the  transaction  of  all  business  which 
may  oifer. 


Grant  and  Organization. 

The  Eoad  is  being  constructed  under  a grant  from 
the  Government  of  Mexico,  to  Edward  Learned, 
Esq.,  of  which  the  following  are  the  more  prominent 
provisions  : 

Term  of  grant,  ninety-nine  years. 

Eight  of  way  over  public  lands. 

Alternate  square  leagues  public  lands  adjacent  to 
road,  donated. 

Subsidy  of  $12,070  per  mile,  payable  by  the  Gov- 
ernment as  sections  of  5 kilometres,  (3TV  miles,)  are 
constructed  and  approved. 

No  subsidy  shall  be  granted  to  any  other  enter- 
prise for  similar  operations  for  20  years. 

Materials  for  construction,  and  machinery,  coal, 
cars  and  rails  for  operation,  exempt  from  duties. 

Capital  invested  exempt  from  taxes  or  imposts  for  • 
twenty  years. 

Passengers  or  merchandise  in  transit  free  from 
duty  for  thirty  years. 


8 


Ports  to  be  kept  open  to  commerce,  and  the  road 
to  public  use  for  term  of  grant. 

Tolls  of  tliree  dollars  (in  and  out)  per  foot 
draught,  on  all  vessels  drawing  over  12  feet,  may  be 
collected. 

Tariff  authorized  on  through  business,  ten  cents 
per  geographical  mile  for  passengers,  eight  cents  per 
ton  per  mile  for  freight,  and  one  per  cent,  of  value 
for  precious  metals  and  jewelry.  On  local  business 
variable  rates,  under  a moderately  remunerative 
schedule. 


To  utilize  the  grant  without  creating  personal  lia- 
bilities, the  Tehuantepec  Inter-Ocean  Railroad  Com- 
pany was  organized  under  the  laws  of  Massachu- 
setts, and  became  the  owner  of  the  grant  in  due  and 
legal  form  in  November,  1879. 

The  issued  stock  of  the  Company  is  fully  paid  up, 
and  is  held  and  managed  by  an  Executive  Commit- 
tee of  the  associate  owners  for  the  common  benefit 
of  parties  now  or  hereafter  to  become  interested. 

The  capital  stock  will  hereafter  be  increased,  as 
provided  for  by  law,  to  $20,000,000,  represented  by 
200,000  shares. 

[Details  of  Organization  in  print.] 

A mortgage  has  been  executed  by  the  Company, 
with  the  sanction  of  the  Mexican  Government,  to 
the  Central  Trust  Company  of  New- York  for  six 
million  dollars,  to  secure  its  six  thousand  thirty  year 
First  Mortgage  Bonds,  bearing  seven  per  cent,  in- 


9 


terest.  This  mortgage  has  been  duly  recorded,  is 
in  full  force,  and  is  the  only  mortgage  upon  the 
property. 

Cost  of  First  Forty  Miles. 

Total  payments  to  date, $1,998,6^.2  44 

Less  guaranty  deposit  with  Mexican  Govern- 
ment,  86,956  52 

$1,911,655  92 


Deduct  for  items  paid  for,  not  appertain- 
ing to  first  40  miles  : 


Rails, 

$226,000 

00 

Rolling  stock, 

50,550 

00 

Steamers  and  dredge, 

83,000 

00 

Ties  on  account, 

15,718 

00 

Surveys,  work,  supplies,  &c.,  on 

Harbors  and  on  Middle  and 

Pacific  Divisions, 

115,490 

00 

Atlantic  Division, 

25,000 

00 

Tools,  materials  and  supplies  on 

hand, 

93,600 

00 

Miscellaneous  items, 

11,500 

00 

620,858  00 

$1,290,797  92 

Add  labor  to  complete  40  miles, 

$75,000 

00 

General  and  incidental  ex- 
penses,   75,000  00 

150,000  00 


Actual  cost,  40  miles, 


$1,440,797  92 


10 


Cost  of  forty  miles, 81, 440, 797  92 

Estimated  Cost  of  Remainder  of  Road  and  Harbors. 

“ Engineer’s  Estimate.” 

“ Clearing,  grading  and  ballasting,  |1,800,000  ” 


“ Bridging  and  waterways, 600,000  ” 

“ Track,  ties,  &c.,  complete, 1,200,000  ” 

“ Engineering,  superintendence, 

&c., 400,000” 

“ Harbors, 1,000,000” 


$5,000,000  ” 

Deduct  for  value  of  rails, 
work  done,  &c.,  as 
above  stated, $620,858 

Less  loans,  bills  and  ac- 
counts payable, 325,000 

295,858 

$4,704,142 

Add  for  interest,  sidings  and  inde- 


terminate  items,  30  per  cent.,. . . 1,411,243 

6,115,385  00 

Cost  of  road  and  harbors, 

Equipment, 

$7,556,183  00 
1,000,000  00 

Total  cost, 

$8,556,183  00 

Money  Required. 

For  completing  first  40  miles, 

“ remainder  of  road  and  harbors 

For  equipment, 

$150,000 
, 6,115,385 

1,000,000 

Total, 

$7,265,385 

From  Subsidy  to  accrue, $1,908,742 

“ Guaranty  deposit, 86,956 

“ Company’s  resources, 5,269,687 


$7,265,385 


11 


Resources. 


Capital  stock  issued  and  paid  up, $1,500 

First  Mortgage  7 per  cent,  bonds, 6,000,000 

Government  money,  subsidy, 2,000,000 

“ land  (not  yet  ascertainable,)  ....  .... 

“ Guaranty  deposit  in  Mexico, 86,956 


Future  increased  capital  stock,  now  represent- 
ed by  $6,000,000  Preferred  Certificates,  even- 
tually to  be  converted  into  60,000  common 


shares, 6,000,000 

And  by  $14,000,000  Unpreferred  Certificates, 

to  be  exchanged  for  140,000  common  shares,  14,000,000 


$28,088,456 

$1,637,000 

450,000 
91,258 

2,178,258 

Available  resources,  at  par  value, $25,810,198 

Revenue  and.  Value. 

In  estimating  the  revenue  of  this  road,  reference 
is  not  had  to  the  theories  of  enthusiasts  as  to  the 
prospective  business  of  the  Pacific,  nor  to  the  aston- 
ishing and  vast  annual  increase  established  by  sta- 
tistics, but  reliance  has  been  placed  upon  official 
data  of  the  traffic  of  1878,  which  will  derive  benefit 
from  this  route,  and  which  will  doubtless  furnish  of 
through  business  the  tonnage  claimed. 


Deduct  for  bonds  disposed  of, . ... 
“ Preferred  Certificates, 

disposed  of, 

“ Subsidy,  received,. . . . 


12 


750,000  tons  of  freight  at  $5,  (less  than  forty 


per  cent,  of  rate  allowed,) $3,750,000 

15,000  passengers  at  $10, 150,000 

Local  business, . . 125,000 

Tonnage  dues,  tolls  and  all  other  revenue,.. . . 350,000 


$4,375,000 

Deduct  for  operating  expenses,  repairs  and  de- 


preciation, 50  per  cent.,  (excessive,) 2,187,500 

$2,187,500 

Allowance  to  Mexican  Government, 187,500 

Annual  net  income, $2,000,000 

Interest  on  $6,000,000  mortgage  bonds, 420,000 


$1,580,000 

equal  to  eight  per  cent,  on  par  value  of  the  proposed 
200,000  shares. 

Upon  the  above  estimate  of  revenue , the  road  and 
harbors  have  a value  of  $30,000,000. 

General  Facts  and  Conclusions. 

The  delays,  disadvantages  and  loss  ordinarily  in- 
cident to  incipient  operations  have  in  this  case  been 
most  discouraging  and  excessive.  The  locality  was 
remote,  transportation  uncertain,  trained  labor, 
shelter  and  supplies  unobtainable,  the  country  with- 
out roads,  and  so  covered  with  tropical  vegetation 
and  vines  interlaced  with  timber  as  to  make  explora- 
tion, surveys  and  work  vexatious  in  progress  and 
extravagant  in  cost,  and  much  more  expensive  per 
mile,  in  the  opinion  of  those  familiar  with  the  now 


13 


explored  and  located  line  of  the  road,  than  any  other 
portion,  excepting  a few  miles  between  Chivela  Pass 
and  the  Pacific  plains. 

In  regard  to  the  above  valuation  of  $30,000,000, 
based  on  assumed  revenue,  it  is  worthy  of  note  that 
the  recent  sale  of  the  Panama  road  shows  a similar 
gross  valuation  as  the  basis  of  its  purchase. 

The  advantages  of  this  route  over  the  Panama  are 
manifest ; its  business  will  be  transferred  from  ships 
to  cars  in  well  protected  harbors,  by  elevators  and 
mechanical  appliances,  at  a minimum  cost,  while  at 
Panama  an  expensive  lighterage  of  several  miles  is 
incurred,  and  at  Aspinwall,  terminal  facilities  are 
inadequate  and  insecure. 

The  Port  of  Salina  Cruz  is  readily  accessible  ; that 
of  Panama  is  subject  to  calms  extending  hundreds 
of  miles  seaward,  which,  according  to  report  of 
Commodore  Maury,  make  navigation  uncertain  and 
protracted,  a condition  which  must  divert  to  this 
route  much  of  the  “ West  Coast”  or  South  Ameri- 
can trade. 

The  location  of  this  road  is  in  a healthful  and 
salubrious  climate,  and  its  proximity  to,  and  early 
close  connection  with,  the  railway  system  of  Mexico, 
now  being  developed,  will  largely  favor  this  route. 

The  important  saving  of  time  and  distance  between 
Atlantic  and  Pacific  ports,  as  compared  with  Panama 
or  Cape  Horn,  will  attract  to  this  route  traffic  now 
impossible  to  define  or  estimate. 

The  wheat  of  California  and  Oregon,  the  products 
of  Australia,  China,  Japan  and  adjacent  countries, 
and  of  the  islands  of  the  Pacific,  will  be  conveyed 


14 


more  cheaply  and  expeditiously  than  by  any  other 
route  or  trans-continental  railway. 

New  sources  of  this  business  are  constantly  devel- 
oping, and  its  volume  will  soon  overtax  the  single 
track  capacity  of  the  road  ; but,  without  speculating 
upon  the  future,  enough  is  known  of  the  present  to 
warrant  the  foregoing  estimate  of  revenue. 

Interest  and  insurance  by  this  route  will  be  mate- 
rially lessened. 

Heavy  freights  between  the  Atlantic  and  Pacific 
States  will  be  delivered  at  less  cost  and  in  less 
time  than  by  any  existing  or  projected  railway 
line. 

The  transportation  of  the  wheat  of  California  and 
Oregon  forms  so  important  an  item  in  the  estimate 
of  revenue,  that  it  is  j)roper  to  give  data  which  sus- 
tain the  estimate  and  show  the  desirability  of  this 
route  over  other  existing  or  projected  railway  lines, 
and  over  either  of  the  other  modes  proposed  for  its 
movement. 

In  1881  the  surplus  wheat  of  these  States  subject  to 
export  was  over  50,000,000  bushels,  equal  to  1,250,000 

tons,  the  rate  of  freight  from  San  Francisco  to 

K 

Liverpool  via  Cape  Horn,  sixty  shillings  ($14.70) 
per  ton.  On  a mileage  basis  via  Tehuantepec  the 
sea  rate  would  be  $7.54,  to  which  is  to  be  added  for 
railway  charges,  $5  =$12.54,  equal  to  14J  per  cent, 
in  favor  of  Tehuantepec.  From  Oregon  to  Liverpool 
via  Cape  Horn,  seventy  shillings  ($17.15)  per  ton, 
via  Tehuantepec,  $14.15,  equal  to  17^  per  cent. 

Inasmuch  as  this  wheat  can  be  discharged  and 
loaded  at  the  railroad  ports  as  cheaply  as  at  Chicago 


15 


or  Buffalo,  and  can  be  hauled  for  ]ess  than  one  cent 
per  ton  per  mile,  giving  an  actual  cost  of  discharge 
and  transfer  not  exceeding  two  dollars  per  ton,  com- 
petition by  an  ocean  route,  or  by  any  other  Isthmian 
route,  will  be  practically  impossible. 

In  regard  to  ship-railway  and  canal  projects,  with- 
out discussing  the  feasibility  of  either  as  an  engineer- 
ing possibility,  it  is  sufficient  to  say  that  producers, 
merchants  and  consumers  require  cheap  transporta- 
tion ; that  investors  and  capitalists  require  fair  in- 
come and  security ; that  these  requirements  are 
neither  assured  nor  even  probable  under  experimental 
schemes  which  demand  an  original  outlay  of  hun- 
dreds of  millions  of  dollars,  and  which  are  there- 
after to  be  operated  in  competition  with  an  ordinary 
railway  which  will  cost  less  than  ten  millions , and 
will  have  an  established  trade  which  it  can  maintain 
against  any  rate,  covering  expenses  only,  which  its 
rivals  may  attempt.  Under  either  scheme,  canal  or 
ship-railway,  income  and  interest  must  be  ignored, 
or  cheap  transportation  will  be  defeated  ; hence, 
neither  is  of  any  present  interest  to  this  enterprise. 

Mexico  has  entered  upon  an  era  of  prosperity, 
which  will  steadily  advance  under  its  now  ruling 
policy,  which  invites  and  protects  foreign  enterprise 
and  capital,  and  assures  investors  that  no  means  will 
be  omitted  to  meet  the  obligations  and  intentions  of 
its  railway  grants,  on  which  so  largely  depend  the 
development  of  its  resources,  the  extension  of  its 
trade,  and  the  enlargement  of  its  friendly  relations 
and  intercourse  with  its  neighbors ; under  this  im- 
pulse millions  of  American  capital  are  being  invested 


16 


in  these  enterprises,  and  the  good  faith  of  the  Gov- 
ernment is  daily  being  demonstrated  in  the  payment 
of  its  subsidies  and  the  liberality  of  its  executive 
action. 

Office  of  the  Tehuantepec  Inter-Ocean  Railroad  Company, 

52  Broadway,  New- York, 

March  15  th,  1882. 


